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Nearly 8M Americans have fallen into poverty since summer

125 points by tempsy 6y ago

war1025 6y ago
Who would have guessed that kneecapping the service industry would be bad for the service sector?
- t-writescode 6y ago
  Most reasonable people that asked for lockdowns also asked for stimulus packages to give those people who couldn't work money while they're out of work so they could survive.
  - neuland 6y ago
    And yet they didn't stop the lockdowns once it was clear the stimulus was not going to happen.
    - t-writescode 6y ago
      Given a virus that requires hospitalization at a certain rate, there is a certain point where the hospitals end up overrun for all other activities. In an effort to stave off that danger, local governments enacted lockdowns with the intent of reducing the spread of the virus. The virus, in the United States, has an established death rate of around 1.5% and a hospitalization rate higher than that. It also experiences exponential growth. Our hospitals didn't have the capacity to handle all the _potential_ load; and, once they're approaching that capacity, it's already too late and they'll blow past it. That's the danger of exponential growth. Let's imagine doublings: 1, 2, 4, 8, 16, 32, 64, 128. If total capacity is 100, the moment that capacity is less than 20% used up, we're 2-3 timesteps away from using over 100%. It is a very dangerous gamble, and controversial decisions are made or not made and the worst part is that, when you do the safe thing, you have no way of being certain or explaining that the bad thing would have or could have happened, because "it's only 20%" and that looks small.
      - neuland 6y ago
        Florida, Texas, and Sweden seem to be doing fine. Edit: also, the military, FEMA, and non-profits built temporary hospitals in spring, but they weren't needed.
      - umvi 6y ago
        We had months and months to build temporary hospitals... Why didn't we?
        matthewmacleod 6y ago
        Who were you planning to staff all of your temporary hospitals with?
        deleted 6y ago
        [deleted]
        umvi 6y ago
        So you are saying our hospital beds and staff are fixed immutable resources and that in an emergency all other variables must be sacrificed in order to not exceed those fixed immutable resources?
        matthewmacleod 6y ago
        I don't recall saying that, no. I'd wager that nobody would seriously say that, since it's obviously false.
        umvi 6y ago
        I interpreted the question as you implying temporary hospitals are absurd because there wouldn't be staff to man them.
        t-writescode 6y ago
        At some point, you're experiencing runway problems. 9 women can't produce a baby in a month, after all. They can, however, collectively produce 9 babies, 9 months after the start date.
    - uoaei 6y ago
      I don't see how that would be a reason to stop the lockdowns. Remember that there is a severe respiratory contagion going around that spreads from breathing the same air as infected folks.
      - neuland 6y ago
        Florida, Texas, and Sweden seem to be doing fine enough.
        bearjaws 6y ago
        Tell that to the ICU nurses and doctors in Florida who have to code several people a day due to Covid...
        neuland 6y ago
        Tell that to the family that lost their job and is now homeless. Tell that to the people who've lost love ones to suicide, overdose, alcoholism. (see I can be snarky and unhelpful, too) The broader point is that it's not clear that lockdowns are beneficial or necessary. They have real costs. Nobody is talking about how we weigh those costs and benefits. And despite the lockdowns, California still has a swamped medical system. To move the conversation forward: people will never give up their sacred cows. The lockdowns were never about COVID, they're about control and rewarding political allies. Texas tried to ban abortion. California tried to ban religion. And nobody cares if the lockdowns work or not.
        henrikschroder 6y ago
        Heart disease and cancer combined kill four times as many people every year, than what covid-19 has done this year. About 10% of all the people who died in the US this year will have died from covid-19. Why are those 10% of deaths so much more terrible, so unimaginably horrible, that we're focusing exclusively on those, and completely ignoring the remaining 90% of deaths?
        t-writescode 6y ago
    - dragonwriter 6y ago
      The lockdowns were more essential than the stimulus payments, though no sane government would fail to do both in the circumstances. (Our government failed on both the lockdowns, which were scattered, too late in many places, and too poorly enforced in most places, and stimulus, but then our government, at many levels, has not been sane.)
  - umvi 6y ago
    And other reasonable people are concerned with the side effects of printing 3+ trillion dollars
    - t-writescode 6y ago
      A very frustrating thing with this statement is that it's very arguable that financing the survival of this country's citizens during a lockdown is _exactly_ the sort of thing the government should be doing, as well as minimizing the duration of the lockdown. It enables the status quo to return quickly and minimizes the change to the social fabric. Those are things I would have imagined conservatives would want: stability. It's very strange that we couldn't move money around and hadn't been saving money "for a rainy day" exactly like this one.
      - umvi 6y ago
        As I understand it, we have no saved money, we are just going deeper into debt. In 2020 alone we took on at least 4T of debt when in past years we only take on ~1T debt per year. And all we have to show for 2T was a "woefully inadequate" $1000 check. In order to pay everyone's rent for a year, we would need at least 12x as much, in other words a cool 24 Trillion which would more than double the entire debt the US current has. And for what? To save a few lives, the majority of whom will be dead before 2030 anyway? Mask and social distancing are huge low cost public health wins, no doubt, but suggesting going 24 trillion dollars into debt to save more lives is a huge red flag to me and I would push back.
        t-writescode 6y ago
        In a very real sense, what more have the "lockdowns" in the US been than "masks and social distancing"? In places where "social distancing" minimums have been impossible, the places have closed. I'm in one of the most strict places in the entire United States, but I can still go to most every store I want, including hair salons. I'm only barred from places where there's a LOT of breathing (gym, church with singing), tight confines where social distancing can't be done (bars, restaurants) or staying in a singular location for a long time (church, clubs, sporting events).
- dopylitty 6y ago
  The issue is that the US government has refused to help people during a time when they should absolutely not be forced to work face to face jobs to pay the bills. Instead Republicans have held aid hostage in exchange for legislation allowing businesses to force employees to work in unsafe environments with no recourse[1]. Even so far as a measure that would allow the US attorney general to penalized employees up to $50k for having the audacity to sue businesses for creating unsafe environments.[2] 1. https://www.washingtonpost.com/opinions/2020/12/15/disturbing-values-driving-gops-handling-covid-relief/ https://www.washingtonpost.com/opinions/2020/12/15/disturbin... 2. https://www.jacobinmag.com/2020/12/covid-liability-shield-lawsuits-legislation https://www.jacobinmag.com/2020/12/covid-liability-shield-la...
  - treeman79 6y ago
    Load of crap. Republicans were willing to negotiate on a smaller package. It was held up by the speaker because it made Trump look bad.
    - HenryKissinger 6y ago
      Republicans refused to remove a liability shield for companies from the bill. That's a good reason to refuse to pass the bill.
      - AnimalMuppet 6y ago
        Is it? Why is that so important that it's worth not aiding millions of people who are dropping into poverty?
        uoaei 6y ago
        I can't tell if this is a question posed in earnest, because I wouldn't expect a reaction like that to "corporations are designing and feeding Congress a liability shield so that they don't have to spend money protecting their workers." The "aid" is a red herring if you are setting up those same people for dangerous situations with zero accountability from the people who are forcing them to put themselves in hazard's way. It is myopic to think that a smaller stimulus bill (that would barely cover 1 month's expenses for the average American -- recall that it's been 8 months since the first stimulus) would be proposed for anything except to stave off the fervor of mass civil unrest for a short while longer.
- OminousWeapons 6y ago
  The blame for the situation lies squarely at the feet of the federal government. If you are going to shutter businesses and put people out of work, you need to pay the business owners and the employees who you have affected. Staying economically viable vs staying medically viable should have never been a tradeoff people had to make here, and Americans should all remember that when the next election rolls around.
  - war1025 6y ago
    > Americans should all remember that when the next election rolls around Unfortunately, for most people the truth is that they "like their representatives, it's all the rest that are corrupt" Plus Washington is close enough to a 50/50 split right now that you can always just say it was the other party holding everything up.
    - djsumdog 6y ago
      Our election processes have never been fair. Big money has typically been the largest factor. This year solidifies it .. at least for half the population. The American psyche has been split in two by a corrupt and runaway media.
  - TheBlight 6y ago
    But the federal government didn't shutter any businesses. You can thank the state governors, county officials and big city mayors for that.
    - OminousWeapons 6y ago
      My point is that the governors and mayors always had to weigh the economic damage they were doing to people whenever they made a shutdown decision, which resulted in erratic, complicated, and somewhat nonsensical shutdown orders. If the federal government had backstopped the economy properly and compensated any business or person directly affected by a shutdown, then the governors / mayors would have been able to take more coordinated, effective action. You can't maintain aggressive shutdowns if every day of your shutdown is destroying peoples' bank accounts.
- kergonath 6y ago
  Dead customers aren’t that much better for the service industry.
  - sparrish 6y ago
    Some dead customers is much better than zero customers.
  - umvi 6y ago
    All the customers wouldn't be dead, 1% or less of the customers.
    - deleted 6y ago
      [deleted]
3minus1 6y ago
I heard this on NPR recently and was really moved by it [1]. Recommend reading the whole thing. > You know me. I'm in your friendship circle, hidden in plain sight. My clothes are still impeccable, bought in the good years when I was still making money. To look at me, you would not know that my electricity was cut off last week for non-payment or that I meet the eligibility requirements for food stamps. But if you paid attention, you would see the sadness in my eyes, hear that hint of fear in my otherwise self-assured voice. [1] https://www.npr.org/transcripts/945092228 https://www.npr.org/transcripts/945092228
- deleted 6y ago
  [deleted]
- save_ferris 6y ago
  The fear of "looking poor" is so real in the US, which makes it harder to see who's struggling. It also creates this cognitive dissonance I've noticed here on HN where an article gets posted with pictures of the extended lines at food banks and people point out that most people seem to be driving relatively new cars, therefore why are they in line at a food bank? I think a lot of people don't understand how poverty really looks because we're socially motivated to project wealth and status wherever we can.
  - powersnail 6y ago
    Another aspect is that selling used stuff doesn’t bring much money in, especially clothing. I don’t even know whether it’s sellable. Apart from my car, if I sell all my belongings, I might get one month worth of rent. Hardly seems worth it, unless there is a way to use that money to earn more money.
    - toomuchtodo 6y ago
      Also can’t sell or trade your car to downgrade if you need a car, as if you need financing to get the next car, you’re not going to qualify for the loan if you’re without employment. Your car is a trailing indicator of your financial situation, not necessarily present state.
hn_asker 6y ago
We need UBI
- djsumdog 6y ago
  I use to believe in UBI, but I think introducing UBI now would be an absolutely and complete disaster. UBI makes sense if there is zero resource scarcity. If we had working Fission reactors and were pulling asteroids into orbit to mine, it might make sense. I think UBI implemented now would turn into the "Basic" seen in The Expanse books. We'd just see people with no incentives continue down the road of poverty.
  - uoaei 6y ago
    Yours is a Randian analysis and it has been the sole argument from Republicans for not giving people UBI. What do you think about the concept of "trickle-up economics"?
    - nobody9999 6y ago
      >Yours is a Randian analysis and it has been the sole argument from Republicans for not giving people UBI. >What do you think about the concept of "trickle-up economics"? I'd argue that significantly enhancing the social safety net, significantly increasing minimum wages and, most importantly, providing strong incentives toward reduced incomes at the very high end, would provides significant long term economic advantages. Why do I say this? For a variety of reasons: 1. >70% of US GDP is consumer spending. Increasing the amount and number of folks with discretionary income will boost demand significantly; 2. Enhancing the social safety net would encourage innovation and entrepreneurship. When you have an idea that you want to develop, but most folks don't even have a few hundred dollars available in an emergency will stop those folks from doing so -- In the current environment, unless there's immediate success, it's likely that such a person, and their family, will be sleeping rough and eating out of garbage cans pretty soon. With a robust social safety net, those folks can pursue their entrepreneurial ideas without worrying about starving in the street; 3. Incentivizing lower incomes at the very high end, via income taxes (cf. the 1950s), write offs for new business formation/development and other, similar incentives can boost employment, new business creation and focus resources on an ecosystem of smaller companies with real competition in many (if not most) industries; 4. Raising wages at the low end dovetails nicely with (1) above. Spreading wealth more widely (I am emphatically not suggesting forced wealth redistribution) among the population won't harm those at the top. How many houses, cars, dishwashers, pizza pies, miniskirts, throw rugs, yachts, toaster ovens, ball gags, window fans, telephones, snow globes, etc., etc., etc. can one family reasonably buy/use? Significantly increasing the incomes of those at the bottom will increase demand for all manner of products and services, strengthening the broader economy over the long term. 5. Finally, I'll wonder out loud how much "poorer" or "worse off" someone earning $5,000,000/annum is vs. someone earning $15,000,000/annum? Having wealth/income more widely distributed across the population would create a stronger, more resilient economy over the long term -- one which would benefit those at the top and the bottom -- and lead to significantly better outcomes for everyone over the long term. I'd note note that my reasoning doesn't include any arguments for "socialism." Rather, every single one focuses on how to strengthen and enhance a society and economy based on market principles. Feel free to disagree, as I'm sure many of you will. I'd be interested to hear your arguments and will attempt to respond thoughtfully. Edit: Fixed numbering.
hypervisorxxx 6y ago
Yeh in some cases. In others what is poverty. Moving back in with your parents so not having an income but also not having to pay rent. Alot of people I know in NYC have just chosen not to pay rent and are not being evicted so they are living in poverty but in fancy areas of brooklyn and not having to work. Poverty to me is being homeless despite working and your income doesn't or barely covers the bills. In the covid case many have lost their income but they have also lost their responsibility to pay the bills. I don't say this to be mean nor do I include restaurant owners who have to pay commercial rent while the doors are closed. I say this about kids who moved into their parents second vacation homes but lost income on paper. I feel bad for people who have lost their jobs and have to pay rent. Not so much for people who have lost their jobs and their requirement to pay bills.
- lilott8 6y ago
  This reads sort of tone deaf to me. There is a clear definition of what it means to be impoverished. In the US it's income relative to dependents, [defined by HHS](https://aspe.hhs.gov/poverty-guidelines https://aspe.hhs.gov/poverty-guidelines). TO say that someone isn't impoverished because they are living rent-free (legally or illegally) or don't have obligations to pay bills misses the point altogether; and quite frankly, is flat out insincere. It doesn't matter if the child moves back in with their parent and doesn't have bills to pay. I'm curious to know, what if the person that loses their job is 40 and moves in with their parents? My point is, I don't think it matters if it's a child moving in to their parent's second house -- they may never be able to recover from this, and that is the larger, systemic problem at hand. How we, as a collective society, address issues pertaining to the poor, disenfranchised, forgotten, downtrodden, speaks volumes about our priorities and interests. And I think, given the types of relief that has happened during this moment, and looking at how society answers this historically, we are not doing well.
purple_ferret 6y ago
Yet the rich get richer as Congress passes 'relief' plans that allow the wealthy to sneak massive chunks of cash directly into their pockets. Here's just one example: "According to the National Federation of Independent Business (NFIB), about 85% of all the approved Paycheck Protection Program (PPP) loans were for less than $150,000...The bipartisan bill holds the intention of automatically forgiving loans of less than $150,000." [1] 85% of so called 'paycheck protection' loans didn't/won't actually have to go to paying staff after all. Up to $22,000 per employee directly in the owner's pocket regardless of how the business was doing at all. [1]https://www.solo401k.com/blog/news-ppp-forgiveness-for-loans-under-150k/ https://www.solo401k.com/blog/news-ppp-forgiveness-for-loans...
- enriquec 6y ago
  Class warfare is pointless. Businesses are shuttering. Sure, make accusations of fraud (do you have any proof?) - but those expenses can't be frivolous unless you want a huge issue with the IRS. Should relief be so strict and policed (its own cost) or should it be flexible for businesses that may have had to build outdoor accomodations?
  - dragonwriter 6y ago
    > Class warfare is pointless. The position of the capitalist class, built on successful class warfare first against the pre-capitalist aristocracy and then against the working classes within capitalism, proves this to be false. As, for that matter, does the (arguably modest, but still very real) progress of the working class from the height of the system first described as “capitalism” in the late 19th and early 20th centuries through its replacement by the modern mixed economy from the mid-20th century to today as a result of class warfare by the working classes against the entrenched capitalist class. Though “class warfare is pointless” is always what those defending class warfare by the capitalist class say when the working classes fight back.
    - NoOneNew 6y ago
      >The position of the capitalist class, built on successful class warfare first against the pre-capitalist aristocracy and then against the working classes within capitalism, proves this to be false. Name me a socialist/communist gov that did any better. Each implementation grew the class divides even more. So far China, I would say, is the most economically viable model due to their opening to international market practice. However, the party still controls it and divvies out the work to a select few. Their social credit system helps them determine who is more worthy by putting people in different categories... oh wait that's just a class system with extra steps. It's not a capitalist fault. It's a human fault. We've done it for not hundreds of years, but thousands upon thousands. Long before Adam's or Marx parents were a twinkle in anyone's nethers. Finding a scapegoat for problems you dont quite understand and refuse to research beyond a 10min youtube cartoon does not constitute as good logic.
hypervisorxxx 6y ago
The other thing not being mentioned is alot of families who could never afford to buy homes can now buy homes. It has also allowed alot of people to move into nicer areas of NYC that could not afford to before. Alot of people's quality of life has increased, and alot of people who lost their income on paper also lost their requirement to pay rent and avoid being evicted or just moved into their parents homes. There are some who have lost their income but also still have to pay bills and their quality of life has not improved. I think those numbers are not reflected in this article especially in relation to all of the people who could not afford to live in nice areas or buy homes who have now been able to. In NYC when asian demographic no longer could come to the u.s. To invest $300k into an empty apartment building that they will never inhabit to expedite their green card process, are now being inhabited by hardworking Americans who were able to buy condos that previously they were not able to compete with with international millionaires using real estate for tax and legal loopholes. None of this is reflected in the article.
- est31 6y ago
  Do you have a link for real estate prices going down? From what I saw it was mainly the rents that decreased.
  - khalilravanna 6y ago
    Not directly in line with OP’s comment but interest rates are stupidly low right now. Wouldn’t surprise me if this enables a lot of people to buy homes. I know several people (late 20s, early 30s Boston area) who have bought homes recently and I myself am refinancing.
    - uoaei 6y ago
      Interest rates don't mean anything if the down payment (or requirements for a loan) are still high for new buyers. Interest rates only matter if you already have money. Most people don't.
      - 6y ago
TheBlight 6y ago
I sure do hate it when I slip and fall into poverty as if it were some silly accident of my own making and not entirely caused by the actions of state and local governments.
- NicoJuicy 6y ago
  You are that saying herd immunity would be the only option?
  - TheBlight 6y ago
    Herd immunity is the end-state (with or without a vaccine) not some policy option to pursue. It is what will eventually happen. The trick is getting to that end-state with the least amount of damage incurred. I would've advocated for something more closely resembling: https://gbdeclaration.org/focused-protection/ https://gbdeclaration.org/focused-protection/
    - thebruce87m 6y ago
      In my country (Scotland) the 45 - 64 age group has occupied the most hospital beds during the pandemic: https://www.travellingtabby.com/scotland-coronavirus-tracker/ https://www.travellingtabby.com/scotland-coronavirus-tracker... Scroll to “Hospital Admissions by Age Group” and select total. So that would involve shielding everyone 45+ to protect hospital capacity in an unrestricted “shield the vulnerable” scenario.
  - thebean11 6y ago
    It's not like that's the only solution that's been floated. Stimulus checks would have kept people out of poverty too.
    - ardy42 6y ago
      > It's not like that's the only solution that's been floated. Stimulus checks would have kept people out of poverty too. You're right, but the implications of the GGP comment's phrasing imply they wouldn't have liked that solution. IMHO, in some quarters, the weeping and gnashing of teeth about the costs mandatory social distancing (up to and including stay at home orders) directly flows from the rejection of government relief as a solution to anything. If you take that off the table, you're left with a false choice between pandemic destruction and economic destruction.
anovikov 6y ago
I wonder how anyone at all expected this to turn out. So, businesses had to stop operating. GDP and income earned and spent, dropped. This by definition results in someone becoming poor - with or without bailout - the government does not have any of "its own" money - all money it can possibly distribute is taken from taxpayer's pockets. Call me cynical, but people working in the service industry were the safest ones to let fail without causing domino effect - they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008.
- deleted 6y ago
  [deleted]
- cinquemb 6y ago
  > they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008. Yeah, well you are forgetting the people they were renting from have mortgages… 2008 will be a cake walk compared to this… can't "extend and pretend" forever…
- uoaei 6y ago
  > the government does not have any of "its own" money - all money it can possibly distribute is taken from taxpayer's pockets This is absolutely not the case. The government owns and operates a mint, and we haven't been on the gold standard since Nixon. There is no zero-sum double-entry accounting when it comes to sovereign fiat currencies. If you analyze the monetary policy of the federal government like it's a family balancing a checkbook, you are buying right into the rhetoric that keeps the peanut gallery shrieking "but the deficit!" and prevents us from actually investing in the public's health and needs. Federal deficit is public surplus. It is the federal government investing in its citizens in the most literal way possible. > Call me cynical, but people working in the service industry were the safest ones to let fail without causing domino effect - they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008. That's not cynical, that's sociopathic.
mybrid 6y ago
But hey, the NASDAQ and DOW are setting historical records. Nothing to see here, move along.
ceilingcorner 6y ago
Meanwhile, some of the strongest voices calling for near-permanent lockdowns came from the well-paid professional classes, who could afford to order Uber Eats twice a day and had zero chance of losing their over-inflated incomes. The continuing erosion of the middle class isn’t a good thing. Expect populist political rhetoric to continue growing.
- umvi 6y ago
  It's what happens when you fixate on optimizing for only one variable (in this case total covid deaths or perhaps hospital ICU capacity). All other variables must be sacrificed to optimize the one variable, even if it means pushing millions into poverty, destroying industries, educationally handicapping multiple generations of students, etc.
  - AlexandrB 6y ago
    If that one variable was actually optimized for in a prompt manner, COVID would already be over in the US. It’s the half-assed waffling that’s causing this to drag on for the better part of a year now.
- snarfy 6y ago
  The near-permanent lockdowns needed to be offset by government payment programs like they were in every other developed country except the US. If they shut everything down but don't offset it somehow, what do they expect the result to be? The $1200 check was laughable.
  - mdavis6890 6y ago
    I agree we need more cash payments to humans. But we have to be careful not to confuse money with stuff (the goods and services produced by the economy). Giving money does not produce any more stuff, it only increases the competition for and price of the stuff that is being produced. We are producing less stuff because of the pandemic, which means there is less to go around (however it gets allocated), and no amount of money will change that.
DoreenMichele 6y ago
This is a real and serious problem and I wish people would take it more seriously. The actual solution is addressing the barriers to work created by Covid. I actively promoted the local Little Caesar's. At one point, they had so little business they were afraid they would go out of business, but they are unusually well-positioned to move to less risk of infection because they already had a pizza portal, it just wasn't being used by anyone. I made sure to start using it and to promote to other people and to promote online ordering and ordering by phone. They soon were wicked busy and all orders had wait times and they began hiring new people. I'm not against stimulus checks, but that's crisis management. It's not a real solution. A real solution is solving the problems in the way work is structured that is keeping so many people from pursuing an earned income right now. And we aren't taking that seriously enough. If you are in any position whatsoever to work on that, please do. I do what little I can with a small reddit called r/GigWorks, though I don't know that I'm accomplishing anything at all. To try to limit the degree to which people get depressed over this: Keep in mind that we don't have hard numbers for comparing this with confidence to a scenario where people just kept working and more people died as a consequence or ended up permanently maimed by Covid. Humans are terrible at counting the disasters that should have happened but didn't. High unemployment was the short-term cost for trying to lower the death toll. Please take high unemployment seriously as a real problem and work on finding ways to employ people safely via remote work, contactless delivery methods, etc. The cure for this is getting people back to work. The way to do that while the pandemic is still ongoing is to take germ control seriously as a real need in every single job.
- uoaei 6y ago
  Do you live in a rural place with a small, connected community? That's the only way your "promotions" would have had any impact. I find it hard to believe that posting on social media single-handedly saved that business. I find it much more likely that people started getting more acquainted with the new reality of the pandemic and after re-budgeting started buying food at places where you get lots of calories for cheap (like Little Caesar's).
  - deleted 6y ago
    [deleted]
fanatic2pope 6y ago
In America every failure is collective and every success is individual.
tzs 6y ago
That raises the US poverty rate from around 14% to around 16%. Perhaps any steps we take to help the newly impoverished could also be extended to help the 45 million Americans who were living in poverty before COVID?

125 points by tempsy 6y ago

war1025 6y ago

Who would have guessed that kneecapping the service industry would be bad for the service sector?

t-writescode 6y ago
Most reasonable people that asked for lockdowns also asked for stimulus packages to give those people who couldn't work money while they're out of work so they could survive.
- neuland 6y ago
  And yet they didn't stop the lockdowns once it was clear the stimulus was not going to happen.
  - t-writescode 6y ago
    Given a virus that requires hospitalization at a certain rate, there is a certain point where the hospitals end up overrun for all other activities. In an effort to stave off that danger, local governments enacted lockdowns with the intent of reducing the spread of the virus. The virus, in the United States, has an established death rate of around 1.5% and a hospitalization rate higher than that. It also experiences exponential growth. Our hospitals didn't have the capacity to handle all the _potential_ load; and, once they're approaching that capacity, it's already too late and they'll blow past it. That's the danger of exponential growth. Let's imagine doublings: 1, 2, 4, 8, 16, 32, 64, 128. If total capacity is 100, the moment that capacity is less than 20% used up, we're 2-3 timesteps away from using over 100%. It is a very dangerous gamble, and controversial decisions are made or not made and the worst part is that, when you do the safe thing, you have no way of being certain or explaining that the bad thing would have or could have happened, because "it's only 20%" and that looks small.
    - neuland 6y ago
      Florida, Texas, and Sweden seem to be doing fine. Edit: also, the military, FEMA, and non-profits built temporary hospitals in spring, but they weren't needed.
    - umvi 6y ago
      We had months and months to build temporary hospitals... Why didn't we?
      - matthewmacleod 6y ago
        Who were you planning to staff all of your temporary hospitals with?
        deleted 6y ago
        [deleted]
        umvi 6y ago
        So you are saying our hospital beds and staff are fixed immutable resources and that in an emergency all other variables must be sacrificed in order to not exceed those fixed immutable resources?
        matthewmacleod 6y ago
        I don't recall saying that, no. I'd wager that nobody would seriously say that, since it's obviously false.
        umvi 6y ago
        I interpreted the question as you implying temporary hospitals are absurd because there wouldn't be staff to man them.
        t-writescode 6y ago
        At some point, you're experiencing runway problems. 9 women can't produce a baby in a month, after all. They can, however, collectively produce 9 babies, 9 months after the start date.
  - uoaei 6y ago
    I don't see how that would be a reason to stop the lockdowns. Remember that there is a severe respiratory contagion going around that spreads from breathing the same air as infected folks.
    - neuland 6y ago
      Florida, Texas, and Sweden seem to be doing fine enough.
      - bearjaws 6y ago
        Tell that to the ICU nurses and doctors in Florida who have to code several people a day due to Covid...
        neuland 6y ago
        Tell that to the family that lost their job and is now homeless. Tell that to the people who've lost love ones to suicide, overdose, alcoholism. (see I can be snarky and unhelpful, too) The broader point is that it's not clear that lockdowns are beneficial or necessary. They have real costs. Nobody is talking about how we weigh those costs and benefits. And despite the lockdowns, California still has a swamped medical system. To move the conversation forward: people will never give up their sacred cows. The lockdowns were never about COVID, they're about control and rewarding political allies. Texas tried to ban abortion. California tried to ban religion. And nobody cares if the lockdowns work or not.
        henrikschroder 6y ago
        Heart disease and cancer combined kill four times as many people every year, than what covid-19 has done this year. About 10% of all the people who died in the US this year will have died from covid-19. Why are those 10% of deaths so much more terrible, so unimaginably horrible, that we're focusing exclusively on those, and completely ignoring the remaining 90% of deaths?
        t-writescode 6y ago
  - dragonwriter 6y ago
    The lockdowns were more essential than the stimulus payments, though no sane government would fail to do both in the circumstances. (Our government failed on both the lockdowns, which were scattered, too late in many places, and too poorly enforced in most places, and stimulus, but then our government, at many levels, has not been sane.)
- umvi 6y ago
  And other reasonable people are concerned with the side effects of printing 3+ trillion dollars
  - t-writescode 6y ago
    A very frustrating thing with this statement is that it's very arguable that financing the survival of this country's citizens during a lockdown is _exactly_ the sort of thing the government should be doing, as well as minimizing the duration of the lockdown. It enables the status quo to return quickly and minimizes the change to the social fabric. Those are things I would have imagined conservatives would want: stability. It's very strange that we couldn't move money around and hadn't been saving money "for a rainy day" exactly like this one.
    - umvi 6y ago
      As I understand it, we have no saved money, we are just going deeper into debt. In 2020 alone we took on at least 4T of debt when in past years we only take on ~1T debt per year. And all we have to show for 2T was a "woefully inadequate" $1000 check. In order to pay everyone's rent for a year, we would need at least 12x as much, in other words a cool 24 Trillion which would more than double the entire debt the US current has. And for what? To save a few lives, the majority of whom will be dead before 2030 anyway? Mask and social distancing are huge low cost public health wins, no doubt, but suggesting going 24 trillion dollars into debt to save more lives is a huge red flag to me and I would push back.
      - t-writescode 6y ago
        In a very real sense, what more have the "lockdowns" in the US been than "masks and social distancing"? In places where "social distancing" minimums have been impossible, the places have closed. I'm in one of the most strict places in the entire United States, but I can still go to most every store I want, including hair salons. I'm only barred from places where there's a LOT of breathing (gym, church with singing), tight confines where social distancing can't be done (bars, restaurants) or staying in a singular location for a long time (church, clubs, sporting events).
dopylitty 6y ago
The issue is that the US government has refused to help people during a time when they should absolutely not be forced to work face to face jobs to pay the bills. Instead Republicans have held aid hostage in exchange for legislation allowing businesses to force employees to work in unsafe environments with no recourse[1]. Even so far as a measure that would allow the US attorney general to penalized employees up to $50k for having the audacity to sue businesses for creating unsafe environments.[2] 1. https://www.washingtonpost.com/opinions/2020/12/15/disturbing-values-driving-gops-handling-covid-relief/ https://www.washingtonpost.com/opinions/2020/12/15/disturbin... 2. https://www.jacobinmag.com/2020/12/covid-liability-shield-lawsuits-legislation https://www.jacobinmag.com/2020/12/covid-liability-shield-la...
- treeman79 6y ago
  Load of crap. Republicans were willing to negotiate on a smaller package. It was held up by the speaker because it made Trump look bad.
  - HenryKissinger 6y ago
    Republicans refused to remove a liability shield for companies from the bill. That's a good reason to refuse to pass the bill.
    - AnimalMuppet 6y ago
      Is it? Why is that so important that it's worth not aiding millions of people who are dropping into poverty?
      - uoaei 6y ago
        I can't tell if this is a question posed in earnest, because I wouldn't expect a reaction like that to "corporations are designing and feeding Congress a liability shield so that they don't have to spend money protecting their workers." The "aid" is a red herring if you are setting up those same people for dangerous situations with zero accountability from the people who are forcing them to put themselves in hazard's way. It is myopic to think that a smaller stimulus bill (that would barely cover 1 month's expenses for the average American -- recall that it's been 8 months since the first stimulus) would be proposed for anything except to stave off the fervor of mass civil unrest for a short while longer.
OminousWeapons 6y ago
The blame for the situation lies squarely at the feet of the federal government. If you are going to shutter businesses and put people out of work, you need to pay the business owners and the employees who you have affected. Staying economically viable vs staying medically viable should have never been a tradeoff people had to make here, and Americans should all remember that when the next election rolls around.
- war1025 6y ago
  > Americans should all remember that when the next election rolls around Unfortunately, for most people the truth is that they "like their representatives, it's all the rest that are corrupt" Plus Washington is close enough to a 50/50 split right now that you can always just say it was the other party holding everything up.
  - djsumdog 6y ago
    Our election processes have never been fair. Big money has typically been the largest factor. This year solidifies it .. at least for half the population. The American psyche has been split in two by a corrupt and runaway media.
- TheBlight 6y ago
  But the federal government didn't shutter any businesses. You can thank the state governors, county officials and big city mayors for that.
  - OminousWeapons 6y ago
    My point is that the governors and mayors always had to weigh the economic damage they were doing to people whenever they made a shutdown decision, which resulted in erratic, complicated, and somewhat nonsensical shutdown orders. If the federal government had backstopped the economy properly and compensated any business or person directly affected by a shutdown, then the governors / mayors would have been able to take more coordinated, effective action. You can't maintain aggressive shutdowns if every day of your shutdown is destroying peoples' bank accounts.
kergonath 6y ago
Dead customers aren’t that much better for the service industry.
- sparrish 6y ago
  Some dead customers is much better than zero customers.
- umvi 6y ago
  All the customers wouldn't be dead, 1% or less of the customers.
  - deleted 6y ago
    [deleted]

3minus1 6y ago

I heard this on NPR recently and was really moved by it [1]. Recommend reading the whole thing. > You know me. I'm in your friendship circle, hidden in plain sight. My clothes are still impeccable, bought in the good years when I was still making money. To look at me, you would not know that my electricity was cut off last week for non-payment or that I meet the eligibility requirements for food stamps. But if you paid attention, you would see the sadness in my eyes, hear that hint of fear in my otherwise self-assured voice. [1] https://www.npr.org/transcripts/945092228 https://www.npr.org/transcripts/945092228

deleted 6y ago
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save_ferris 6y ago
The fear of "looking poor" is so real in the US, which makes it harder to see who's struggling. It also creates this cognitive dissonance I've noticed here on HN where an article gets posted with pictures of the extended lines at food banks and people point out that most people seem to be driving relatively new cars, therefore why are they in line at a food bank? I think a lot of people don't understand how poverty really looks because we're socially motivated to project wealth and status wherever we can.
- powersnail 6y ago
  Another aspect is that selling used stuff doesn’t bring much money in, especially clothing. I don’t even know whether it’s sellable. Apart from my car, if I sell all my belongings, I might get one month worth of rent. Hardly seems worth it, unless there is a way to use that money to earn more money.
  - toomuchtodo 6y ago
    Also can’t sell or trade your car to downgrade if you need a car, as if you need financing to get the next car, you’re not going to qualify for the loan if you’re without employment. Your car is a trailing indicator of your financial situation, not necessarily present state.

hn_asker 6y ago

We need UBI

djsumdog 6y ago
I use to believe in UBI, but I think introducing UBI now would be an absolutely and complete disaster. UBI makes sense if there is zero resource scarcity. If we had working Fission reactors and were pulling asteroids into orbit to mine, it might make sense. I think UBI implemented now would turn into the "Basic" seen in The Expanse books. We'd just see people with no incentives continue down the road of poverty.
- uoaei 6y ago
  Yours is a Randian analysis and it has been the sole argument from Republicans for not giving people UBI. What do you think about the concept of "trickle-up economics"?
  - nobody9999 6y ago
    >Yours is a Randian analysis and it has been the sole argument from Republicans for not giving people UBI. >What do you think about the concept of "trickle-up economics"? I'd argue that significantly enhancing the social safety net, significantly increasing minimum wages and, most importantly, providing strong incentives toward reduced incomes at the very high end, would provides significant long term economic advantages. Why do I say this? For a variety of reasons: 1. >70% of US GDP is consumer spending. Increasing the amount and number of folks with discretionary income will boost demand significantly; 2. Enhancing the social safety net would encourage innovation and entrepreneurship. When you have an idea that you want to develop, but most folks don't even have a few hundred dollars available in an emergency will stop those folks from doing so -- In the current environment, unless there's immediate success, it's likely that such a person, and their family, will be sleeping rough and eating out of garbage cans pretty soon. With a robust social safety net, those folks can pursue their entrepreneurial ideas without worrying about starving in the street; 3. Incentivizing lower incomes at the very high end, via income taxes (cf. the 1950s), write offs for new business formation/development and other, similar incentives can boost employment, new business creation and focus resources on an ecosystem of smaller companies with real competition in many (if not most) industries; 4. Raising wages at the low end dovetails nicely with (1) above. Spreading wealth more widely (I am emphatically not suggesting forced wealth redistribution) among the population won't harm those at the top. How many houses, cars, dishwashers, pizza pies, miniskirts, throw rugs, yachts, toaster ovens, ball gags, window fans, telephones, snow globes, etc., etc., etc. can one family reasonably buy/use? Significantly increasing the incomes of those at the bottom will increase demand for all manner of products and services, strengthening the broader economy over the long term. 5. Finally, I'll wonder out loud how much "poorer" or "worse off" someone earning $5,000,000/annum is vs. someone earning $15,000,000/annum? Having wealth/income more widely distributed across the population would create a stronger, more resilient economy over the long term -- one which would benefit those at the top and the bottom -- and lead to significantly better outcomes for everyone over the long term. I'd note note that my reasoning doesn't include any arguments for "socialism." Rather, every single one focuses on how to strengthen and enhance a society and economy based on market principles. Feel free to disagree, as I'm sure many of you will. I'd be interested to hear your arguments and will attempt to respond thoughtfully. Edit: Fixed numbering.

hypervisorxxx 6y ago

Yeh in some cases. In others what is poverty. Moving back in with your parents so not having an income but also not having to pay rent. Alot of people I know in NYC have just chosen not to pay rent and are not being evicted so they are living in poverty but in fancy areas of brooklyn and not having to work. Poverty to me is being homeless despite working and your income doesn't or barely covers the bills. In the covid case many have lost their income but they have also lost their responsibility to pay the bills. I don't say this to be mean nor do I include restaurant owners who have to pay commercial rent while the doors are closed. I say this about kids who moved into their parents second vacation homes but lost income on paper. I feel bad for people who have lost their jobs and have to pay rent. Not so much for people who have lost their jobs and their requirement to pay bills.

lilott8 6y ago
This reads sort of tone deaf to me. There is a clear definition of what it means to be impoverished. In the US it's income relative to dependents, [defined by HHS](https://aspe.hhs.gov/poverty-guidelines https://aspe.hhs.gov/poverty-guidelines). TO say that someone isn't impoverished because they are living rent-free (legally or illegally) or don't have obligations to pay bills misses the point altogether; and quite frankly, is flat out insincere. It doesn't matter if the child moves back in with their parent and doesn't have bills to pay. I'm curious to know, what if the person that loses their job is 40 and moves in with their parents? My point is, I don't think it matters if it's a child moving in to their parent's second house -- they may never be able to recover from this, and that is the larger, systemic problem at hand. How we, as a collective society, address issues pertaining to the poor, disenfranchised, forgotten, downtrodden, speaks volumes about our priorities and interests. And I think, given the types of relief that has happened during this moment, and looking at how society answers this historically, we are not doing well.

purple_ferret 6y ago

Yet the rich get richer as Congress passes 'relief' plans that allow the wealthy to sneak massive chunks of cash directly into their pockets. Here's just one example: "According to the National Federation of Independent Business (NFIB), about 85% of all the approved Paycheck Protection Program (PPP) loans were for less than $150,000...The bipartisan bill holds the intention of automatically forgiving loans of less than $150,000." [1] 85% of so called 'paycheck protection' loans didn't/won't actually have to go to paying staff after all. Up to $22,000 per employee directly in the owner's pocket regardless of how the business was doing at all. [1]https://www.solo401k.com/blog/news-ppp-forgiveness-for-loans-under-150k/ https://www.solo401k.com/blog/news-ppp-forgiveness-for-loans...

enriquec 6y ago
Class warfare is pointless. Businesses are shuttering. Sure, make accusations of fraud (do you have any proof?) - but those expenses can't be frivolous unless you want a huge issue with the IRS. Should relief be so strict and policed (its own cost) or should it be flexible for businesses that may have had to build outdoor accomodations?
- dragonwriter 6y ago
  > Class warfare is pointless. The position of the capitalist class, built on successful class warfare first against the pre-capitalist aristocracy and then against the working classes within capitalism, proves this to be false. As, for that matter, does the (arguably modest, but still very real) progress of the working class from the height of the system first described as “capitalism” in the late 19th and early 20th centuries through its replacement by the modern mixed economy from the mid-20th century to today as a result of class warfare by the working classes against the entrenched capitalist class. Though “class warfare is pointless” is always what those defending class warfare by the capitalist class say when the working classes fight back.
  - NoOneNew 6y ago
    >The position of the capitalist class, built on successful class warfare first against the pre-capitalist aristocracy and then against the working classes within capitalism, proves this to be false. Name me a socialist/communist gov that did any better. Each implementation grew the class divides even more. So far China, I would say, is the most economically viable model due to their opening to international market practice. However, the party still controls it and divvies out the work to a select few. Their social credit system helps them determine who is more worthy by putting people in different categories... oh wait that's just a class system with extra steps. It's not a capitalist fault. It's a human fault. We've done it for not hundreds of years, but thousands upon thousands. Long before Adam's or Marx parents were a twinkle in anyone's nethers. Finding a scapegoat for problems you dont quite understand and refuse to research beyond a 10min youtube cartoon does not constitute as good logic.

hypervisorxxx 6y ago

The other thing not being mentioned is alot of families who could never afford to buy homes can now buy homes. It has also allowed alot of people to move into nicer areas of NYC that could not afford to before. Alot of people's quality of life has increased, and alot of people who lost their income on paper also lost their requirement to pay rent and avoid being evicted or just moved into their parents homes. There are some who have lost their income but also still have to pay bills and their quality of life has not improved. I think those numbers are not reflected in this article especially in relation to all of the people who could not afford to live in nice areas or buy homes who have now been able to. In NYC when asian demographic no longer could come to the u.s. To invest $300k into an empty apartment building that they will never inhabit to expedite their green card process, are now being inhabited by hardworking Americans who were able to buy condos that previously they were not able to compete with with international millionaires using real estate for tax and legal loopholes. None of this is reflected in the article.

est31 6y ago
Do you have a link for real estate prices going down? From what I saw it was mainly the rents that decreased.
- khalilravanna 6y ago
  Not directly in line with OP’s comment but interest rates are stupidly low right now. Wouldn’t surprise me if this enables a lot of people to buy homes. I know several people (late 20s, early 30s Boston area) who have bought homes recently and I myself am refinancing.
  - uoaei 6y ago
    Interest rates don't mean anything if the down payment (or requirements for a loan) are still high for new buyers. Interest rates only matter if you already have money. Most people don't.
    - 6y ago

TheBlight 6y ago

I sure do hate it when I slip and fall into poverty as if it were some silly accident of my own making and not entirely caused by the actions of state and local governments.

NicoJuicy 6y ago
You are that saying herd immunity would be the only option?
- TheBlight 6y ago
  Herd immunity is the end-state (with or without a vaccine) not some policy option to pursue. It is what will eventually happen. The trick is getting to that end-state with the least amount of damage incurred. I would've advocated for something more closely resembling: https://gbdeclaration.org/focused-protection/ https://gbdeclaration.org/focused-protection/
  - thebruce87m 6y ago
    In my country (Scotland) the 45 - 64 age group has occupied the most hospital beds during the pandemic: https://www.travellingtabby.com/scotland-coronavirus-tracker/ https://www.travellingtabby.com/scotland-coronavirus-tracker... Scroll to “Hospital Admissions by Age Group” and select total. So that would involve shielding everyone 45+ to protect hospital capacity in an unrestricted “shield the vulnerable” scenario.
- thebean11 6y ago
  It's not like that's the only solution that's been floated. Stimulus checks would have kept people out of poverty too.
  - ardy42 6y ago
    > It's not like that's the only solution that's been floated. Stimulus checks would have kept people out of poverty too. You're right, but the implications of the GGP comment's phrasing imply they wouldn't have liked that solution. IMHO, in some quarters, the weeping and gnashing of teeth about the costs mandatory social distancing (up to and including stay at home orders) directly flows from the rejection of government relief as a solution to anything. If you take that off the table, you're left with a false choice between pandemic destruction and economic destruction.

anovikov 6y ago

I wonder how anyone at all expected this to turn out. So, businesses had to stop operating. GDP and income earned and spent, dropped. This by definition results in someone becoming poor - with or without bailout - the government does not have any of "its own" money - all money it can possibly distribute is taken from taxpayer's pockets. Call me cynical, but people working in the service industry were the safest ones to let fail without causing domino effect - they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008.

deleted 6y ago
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cinquemb 6y ago
> they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008. Yeah, well you are forgetting the people they were renting from have mortgages… 2008 will be a cake walk compared to this… can't "extend and pretend" forever…
uoaei 6y ago
> the government does not have any of "its own" money - all money it can possibly distribute is taken from taxpayer's pockets This is absolutely not the case. The government owns and operates a mint, and we haven't been on the gold standard since Nixon. There is no zero-sum double-entry accounting when it comes to sovereign fiat currencies. If you analyze the monetary policy of the federal government like it's a family balancing a checkbook, you are buying right into the rhetoric that keeps the peanut gallery shrieking "but the deficit!" and prevents us from actually investing in the public's health and needs. Federal deficit is public surplus. It is the federal government investing in its citizens in the most literal way possible. > Call me cynical, but people working in the service industry were the safest ones to let fail without causing domino effect - they are already poor so they don't have mortgages to default onto - they can't afford even in good times - and that avoids a major risk of repeating 2008. That's not cynical, that's sociopathic.

mybrid 6y ago

But hey, the NASDAQ and DOW are setting historical records. Nothing to see here, move along.

ceilingcorner 6y ago

Meanwhile, some of the strongest voices calling for near-permanent lockdowns came from the well-paid professional classes, who could afford to order Uber Eats twice a day and had zero chance of losing their over-inflated incomes. The continuing erosion of the middle class isn’t a good thing. Expect populist political rhetoric to continue growing.

umvi 6y ago
It's what happens when you fixate on optimizing for only one variable (in this case total covid deaths or perhaps hospital ICU capacity). All other variables must be sacrificed to optimize the one variable, even if it means pushing millions into poverty, destroying industries, educationally handicapping multiple generations of students, etc.
- AlexandrB 6y ago
  If that one variable was actually optimized for in a prompt manner, COVID would already be over in the US. It’s the half-assed waffling that’s causing this to drag on for the better part of a year now.
snarfy 6y ago
The near-permanent lockdowns needed to be offset by government payment programs like they were in every other developed country except the US. If they shut everything down but don't offset it somehow, what do they expect the result to be? The $1200 check was laughable.
- mdavis6890 6y ago
  I agree we need more cash payments to humans. But we have to be careful not to confuse money with stuff (the goods and services produced by the economy). Giving money does not produce any more stuff, it only increases the competition for and price of the stuff that is being produced. We are producing less stuff because of the pandemic, which means there is less to go around (however it gets allocated), and no amount of money will change that.

DoreenMichele 6y ago

This is a real and serious problem and I wish people would take it more seriously. The actual solution is addressing the barriers to work created by Covid. I actively promoted the local Little Caesar's. At one point, they had so little business they were afraid they would go out of business, but they are unusually well-positioned to move to less risk of infection because they already had a pizza portal, it just wasn't being used by anyone. I made sure to start using it and to promote to other people and to promote online ordering and ordering by phone. They soon were wicked busy and all orders had wait times and they began hiring new people. I'm not against stimulus checks, but that's crisis management. It's not a real solution. A real solution is solving the problems in the way work is structured that is keeping so many people from pursuing an earned income right now. And we aren't taking that seriously enough. If you are in any position whatsoever to work on that, please do. I do what little I can with a small reddit called r/GigWorks, though I don't know that I'm accomplishing anything at all. To try to limit the degree to which people get depressed over this: Keep in mind that we don't have hard numbers for comparing this with confidence to a scenario where people just kept working and more people died as a consequence or ended up permanently maimed by Covid. Humans are terrible at counting the disasters that should have happened but didn't. High unemployment was the short-term cost for trying to lower the death toll. Please take high unemployment seriously as a real problem and work on finding ways to employ people safely via remote work, contactless delivery methods, etc. The cure for this is getting people back to work. The way to do that while the pandemic is still ongoing is to take germ control seriously as a real need in every single job.

uoaei 6y ago
Do you live in a rural place with a small, connected community? That's the only way your "promotions" would have had any impact. I find it hard to believe that posting on social media single-handedly saved that business. I find it much more likely that people started getting more acquainted with the new reality of the pandemic and after re-budgeting started buying food at places where you get lots of calories for cheap (like Little Caesar's).
- deleted 6y ago
  [deleted]

fanatic2pope 6y ago

In America every failure is collective and every success is individual.

tzs 6y ago

That raises the US poverty rate from around 14% to around 16%. Perhaps any steps we take to help the newly impoverished could also be extended to help the 45 million Americans who were living in poverty before COVID?